Keppel DC (AJBU) H1 2025 earnings summary

Executive summary

• Distributable income for H1 2025 rose 57.2% year-over-year to SGD 127.1 million, with DPU up 12.8% despite an enlarged unit base from a recent equity fund raise.

• Growth was driven by strategic acquisitions in Japan and Singapore, strong portfolio performance, and major contract renewals, partially offset by divestments and absence of a one-off settlement from 2024.

• Portfolio optimization included asset divestments, ongoing acquisition plans in Asia and Europe, and a focus on resilience.

• Aggregate leverage improved to 30.0% as of 30 June 2025, with $898 million debt headroom.

• Portfolio comprises 24 data centres across Asia-Pacific and Europe, valued at approximately $5.0 billion as of 30 June 2025.

Financial highlights

• Gross revenue for H1 2025 was $211.3 million, up 34.4% year-over-year; net property income rose 37.8% to $182.8 million.

• DPU for H1 2025 declared at SGD 0.05133, payable on 15 September 2025.

• Finance income increased 45.7% to $8.0 million, while finance costs decreased 5.3% to $24.5 million.

• Net asset value per unit increased to $1.58 from $1.53 at end-2024.

• Normalized payout ratio after CapEx reserve is expected at 92%-93%.

Outlook and guidance

• Data centre industry expected to see robust growth, with global demand projected to grow at a 19–22% CAGR through 2030, driven by AI and digitalisation.

• Low aggregate leverage of 30% and declining cost of debt (2.9%-3%) position the REIT for future growth.

• Only 2.6% of contracts by rental income remain to be renewed in H2 2025; robust reversion expected to continue, especially in Singapore and Dublin.

• Ongoing focus on acquisitions in Japan, South Korea, and Europe, and asset enhancement to future-proof the portfolio.

• Macroeconomic uncertainty, trade policy shifts, and geopolitical tensions may impact growth; World Bank forecasts 2.3% global GDP growth for 2025.